Average approved increase in Ontario auto insurance rates smaller, but individual rates vary significantly
Toronto, ON (Feb. 18, 2020) – Before insurance companies offering auto insurance in Ontario can change their insurance rates, they must be filed with and approved by the Financial Services Regulatory Authority of Ontario (FSRA). FSRA has provided an overview of the filings which were reviewed in the fourth quarter of 2019.
Average Rate Changes
Twenty-one insurers, representing approximately 40 per cent of the market, based on premium volume, had rates approved in the quarter. Approved rates will increase on average by 1.56 per cent when applied across the total market. Rate changes approved for each insurer this quarter and effective dates of the rate changes are shown in Table 1 here.
This compares to an increase of 2.60 per cent on average for rate changes approved in the third quarter of 2019.
The rate change shown for each insurance company is the average for that company, based on all the drivers it insures.
However, an individual policyholder may experience a rate change that is either higher or lower than the industry-wide average rate change, or the average rate change for a particular insurer, depending on several factors, such as:
- the vehicle insured,
- where he or she lives,
- driving experience,
- at-fault accident and conviction history of drivers,
- whether the vehicle is used for pleasure or commuting, and
- choices made by the policyholder on coverages purchased and deductible or liability limits.
As most policyholders purchase annual policies, any changes approved for the insurer and effective prior to the policy renewal date, or changes in the policyholder’s circumstances since their last renewal (e.g., at-fault accidents, driving convictions), will impact the policyholder’s rate at renewal.
Consumers are urged to shop around for auto insurance. Rates for the same coverage vary based on each insurer’s claims costs and the insurer’s rating system.
See Auto Insurance Rates for the Fourth Quarter of 2019 for more information, including:
- rate filings approved or ordered by FSCO by company;
- FSCO’s rate approval process;
- a breakdown of claim costs by coverage for accidents.
FSRA is an independent regulatory agency created to improve consumer and pension plan beneficiary protections in Ontario.
FSRA was established to replace the Financial Services Commission of Ontario (FSCO) and the Deposit Insurance Corporation of Ontario (DICO). The agency is flexible, self-funded and designed to respond rapidly to an evolving commercial and consumer environment. In this capacity, FSRA will:
- Promote high standards of business conduct;
- Foster a sustainable, competitive financial services sector;
- Respond to market changes quickly;
- Promote good administration of insurance and pension plans; and
- Encourage innovation.
Learn more about FSRA and our approach to achieving safety, fairness and choice in non-securities financial services at www.fsrao.ca.
SOURCE: Financial Services Regulatory Authority of Ontario (FSRA)Tags: Auto Rates, Financial Services Regulatory Authority (FSRA), Ontario